2Q 2021 DFW Office Market Brief

Market Brief... Dallas/Fort Worth

OFFICE

2Q2021 Property Pictured Above: Granite Tower | 4055 Valley View Lane, Farmers Branch, Texas 75244

DFW OFFICE MARKET BRIEF 2Q 2021

TABLE OF CONTENTS 1. DALLAS/FORT WORTH OFFICE TEAM AND SUBMARKETS

1 2 3

2. OVERALL DALLAS/FORT WORTH OFFICE MARKET

A. Facts and Figures

2. SUBMARKET INTELLIGENCE

A. Dallas Central Business District

B. Central Expressway C. Far North Dallas D. Fort Worth Central Business District E. Las Colinas F. LBJ G. Mid Cities H. North Fort Worth I. Preston Center J. Richardson/Plano K. Southwest Fort Worth L. Stemmons M. Uptown/Turtle Creek

1

DFW

HLC SUBMARKET COVERAGE

2

HLC DFW OFFICE MARKET EXPERTS

MATT CARTHEY

JOHN DICKENSON

GEOFF SHELTON

DAVID CASON

JAMES ENGELS

DAN POND

Partner/Managing Principal - Fort Worth mcarthey@holtlunsford.com 817.710.1111

Managing Principal - Dallas jdickenson@holtlunsford.com 972.421.1971

Managing Principal - Fort Worth gshelton@holtlunsford.com 817.710.1113

Vice President - Fort Worth dcason@holtlunsford.com 817.810.9137

Market Director - Dallas jengels@holtlunsford.com 972.280.8307

Market Director - Dallas dpond@holtlunsford.com 972.380.3641

MASON PRITCHER

JAKE NEAL

MARSHALL MAYS

JACK BEARE

WILLIAM WILSON

AARON DRAPER

Market Director - Dallas mpricher@holtlunsford.com 972.280.8320

Market Director - Fort Worth jneal@holtlunsford.com 817.284.5555

Market Associate - Fort Worth mmays@holtlunsford.com 817.632.6150

Market Associate - Dallas jbeare@holtlunsford.com 972.265.0128

Market Associate - Fort Worth wwilson@holtlunsford.com 817.284.5555

Market Analyst - Dallas adraper@holtlunsford.com 972.381.3219

OLIVIA BARNES

TYLER HOWARTH

HUNTER HEDRICK

QUINN HANFORD

JOHN ARMES

Market Analyst - Dallas obarnes@holtlunsford.com 972.265.0135

Managing Principal Tenant Representation thowarth@holtlunsford.com 972.280.8302

Market Analyst - Dallas hhedrick@holtlunsford.com 972.421.1973

Market Analyst - Dallas qhanford@holtlunsford.com 972.265.0124

Market Analyst - Dallas jarmes@holtlunsford.com 972.381.3210

3

NEW LISTING

GRANITE TOWER

Granite Tower: 241,378 SF Class A office building in the LBJ Submarket.

4

1551 CORPORATE DRIVE

NEW LISTING

1551 Corporate Drive: 167,667 SF Class B office building in the Office Center Submarket.

5

NEW LISTING

2707 STATE STREET

2707 State Street: 8,683 SF Class B office building in the Uptown/Turtle Creek Submarket.

6

FOSSIL CREEK PLACE

NEW LISTING

Stonegate Plaza is a 24,714 square foot office project located in the West-Southwest Fort Worth submarket.

7

HLC DFW OFFICE OVERALL MARKET

2Q2021 Absorption Overall DFW

VACANCY - OVERALL DFW

CONSTRUCTION - OVERALL DFW 25.00%

8,000,000

22.40% 18.50%

20.7%

17.5%

7,000,000

20.00%

6,000,000 15.00%

5,000,000 4,000,000

10.00%

3,000,000 2,000,000

5.00% 1.70%

1.00%

1,000,000 0.00%

2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

3Q 19

Direct Vacancy

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Sublet Vacancy

1Q 21

0

2Q 21

2Q 18

Total Vacancy

3Q 18

4Q 18

1Q 19

2Q 19

3Q 19

4Q 19

Delivered Inventory

ABSORPTION - OVERALL DFW

1Q 20

2Q 20

3Q 20

4Q 20

1Q 21

OVERVIEW - OVERALL DFW

1,600,000

24.0%

1,100,000

23.0%

2,000,000 1,500,000 1,000,000

600,000

22.0%

500,000

100,000

0

21.0%

(400,000)

(500,000)

20.0%

(900,000) (1,400,000)

(1,000,000)

19.0%

(1,500,000)

18.0%

(2,000,000)

(1,900,000) (2,400,000)

2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

1Q 21

2Q 21

Under Construction

(2,500,000)

(2,900,000)

17.0%

(3,400,000)

16.0%

2Q 21

(3,000,000) (3,500,000) 2Q 18

Total Net Absorption

3Q 18

4Q 18

1Q 19

2Q 19

Absorption

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Deliveries

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

Market

Existing Inventory # Bldgs.

Vacancy

Total RBA

Direct SF

Total SF

Vac. %

YTD Net Absorption

YTD Deliveries

Under Const. SF

Quoted Rates

Central Expressway

109

12,603,189

2,406,114

2,537,925

20.1%

(250,165)

30,000

0

$30.90

Dallas CBD

87

29,683,280

7,616,180

8,601,148

29.0%

(386,718)

0

284,600

$26.00

East Dallas

206

8,779,786

1,441,892

1,581,445

18.0%

261,814

348,741

555,476

$27.64

Far North Dallas

514

56,841,792

13,609,445

14,884,870

26.2%

(1,267,716)

808,992

1,188,319

$31.78

Fort Worth CBD

53

8,317,364

1,731,180

1,813,164

21.8%

(94,952)

0

0

$27.67

Las Colinas

312

38,609,187

8,032,843

8,993,396

23.3%

(884,149)

111,805

300,000

$26.59

LBJ Freeway

168

21,374,782

5,003,523

5,275,747

24.7%

(414,548)

0

107,000

$23.79

Lewisville/Denton

190

8,610,051

1,267,267

1,268,325

14.7%

54,225

15,000

95,595

$25.44

Mid Cities

457

25,465,600

5,019,086

5,189,413

20.4%

438,467

32,058

163,086

$25.36

North Fort Worth

68

3,180,058

208,733

216,724

6.8%

3,446

20,000

151,012

$26.80

Northeast Fort Worth

54

3,678,380

564,408

569,265

15.5%

55,997

0

0

$20.98

Preston Center

54

5,030,525

701,427

715,547

14.2%

(56,997)

0

615,632

$42.35

Richardson/Plano

399

33,536,139

6,374,455

6,914,285

20.6%

(156,653)

131,039

184,088

$24.14

South Fort Worth

256

12,839,227

1,612,823

1,757,083

13.7%

(80,249)

0

66,788

$24.74

Southwest Dallas

94

4,263,549

639,224

641,840

15.1%

(7,962)

28,314

30,000

$23.25

Stemmons Freeway

122

13,222,366

3,328,244

3,360,067

25.4%

(13,126)

0

65,000

$20.56

Uptown/Turtle Creek

100

13,703,481

2,473,472

2,763,086

20.2%

(248,414)

0

1,016,688

$41.82

3,243

299,738,756

62,030,316

67,083,330

22.4%

(3,047,700)

1,525,949

4,843,284

$27.66

Totals

Source: CoStar 2Q 2021 Office Report

8

DALLAS CENTRALINTELLIGENCE BUSINESS DISTRICT SUBMARKET Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

16,083

(402,801)

216,790

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

29.0%

29.4%

26.4%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

284,600

284,600

Delivered SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

0

0

Quoted Rates

vs. Prev. Qtr

vs. 12 Mths Ago

$25.94

$26.12

284,600

$26.00

VITAL STATS

30.0%

300,000 200,000 100,000

28.0%

0 (100,000)

26.0%

(200,000) (300,000) (400,000)

24.0%

(500,000) (600,000) 22.0%

(700,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Deliveries

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

• Dallas-based Hillwood has announced designs for what could be Dallas’ tallest skyscraper in more than three decades. The proposed development, Field Street Tower, would be a 38-story office high-rise on Woodall Rodgers Freeway and Field Street, at the convergence of Victory Park, Uptown, and Downtown. Hillwood purchased the nearly two-acre site in 2013 and is actively pitching the site to out-of-state companies for large corporate relocation pre-leasing. The tower would have 520K SF of office space across 23 stories which would sit on top of 13 levels of ground-floor retail and parking.

• Hines will be the first tenant in Deep Ellum’s new office tower, The Stack, after occupying space in Chase Tower for 10 years. The Stack is a joint venture between Westdale Real Estate, Ivanhoé Cambridge and Hines. The 16-story, 200K SF building includes amenities such as a coffee and cocktail lounge, electric vehicle charging stations, private tenant balconies, and a fitness center. With Deep Ellum’s proximity to downtown and the completion of The Epic building, the district is beginning to develop as an office hub.

• Insurance provider, Integrity Marketing Group, is leaving the suburbs to lease 100K SF of office space in Fountain Place Tower. Their move from Cypress Waters will accommodate the firm’s rapid growth from 1,700 employees to 5,500. Dallas-based architect Corgan is designing the new headquarters.

• The PwC Tower has landed $225M in new financing. The owners have lined up new debt on the building which overlooks Klyde Warren Park.

JLL Capital Markets arranged the new loan through Barings Real Estate. The financing was arranged with Massachusetts Mutual Life Insurance, and State Street Bank and Trust Co also holds a portion of the debt. The PwC Tower is more than 90% leased and the building includes three restaurants, a tenant lounge, conference center and health club.

• Calvetti Ferguson has leased 11K SF in Chase Tower. The accounting firm is relocating from Lincoln Centre on LBJ. The firm’s new space in Chase Tower will allow them to quadruple in size as they are experiencing major growth. Calvetti Ferguson is the second suburban Dallas company to announce recent plans to move downtown.

• Another huge office lease has been signed this month in Downtown Dallas. The Federal Deposit Insurance Corp. is moving to the Plaza of the Americas and will occupy 163K SF. The lease follows other recent leases at Plaza of the Americas by major tenants including Thompson Coe, Saville Dodgen & Co. and Estrada Hinojosa.

TOP LEASE TRANSACTIONS

• The Federal Deposit Insurance Corp. has signed a 163K SF lease in the Plaza of the Americas.

• Integrity Marketing Group has signed a 104.3K SF lease in Fountain Place.

• Mint Dentistry has signed a 13.9K SF lease in Bank of America Plaza.

DEALS IN THE MARKET

• The Hartford Building – a 182,641 SF class B office building • The Crescent West End Portfolio – a 176,576 SF class B four (4) building office portfolio • Purse Building – a 65K SF class A office building

NEW DEVELOPMENTS

• 1100 McKinney – a 722K SF class A office tower (proposed) • Field Street Tower | 2012 N Field Street – a 529K SF class A office tower (proposed) • 555 S Pearl – a 500K SF class B office building (proposed) • 2323 Commerce Street – a 400K SF class B office building (proposed) • Two Arts Plaza | 1900 Routh Street – a 283K SF class A office tower (proposed)

LARGE EXISTING VACANCIES

• Fountain Place | 1445 Ross Avenue – 556,688 SF • Renaissance Tower | 1201 Elm Street – 548,833 SF • Bank of America Plaza | 901 Main Street – 314,729 SF • 1700 Pacific | 1700 Pacific Avenue – 262,709 SF • Bryan Tower | 2001 Bryan Street – 224,916 SF • Energy Plaza | 1601 Bryan Street – 206,048 SF • Santander Tower | 1601 Elm Street – 193,210 SF • Chase Tower | 2200 Ross Avenue – 193,102 SF • One Main | 1201 Main Street – 162,809 SF

9

CENTRAL INTELLIGENCE EXPRESSWAY SUBMARKET Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(134,945)

(115,220)

(74,787)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

20.1%

18.9%

15.1%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

30,000

129,422

Delivered SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

0

30,000 Quoted Rates $30.90

vs. Prev. Qtr

vs. 12 Mths Ago

$30.80

$30.48

VITAL STATS

25.0%

200,000 150,000

20.0%

100,000 50,000

15.0%

0 (50,000)

10.0%

(100,000) (150,000)

5.0%

(200,000) (250,000)

0.0%

(300,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

Deliveries

4Q 20

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • Dairy Farmers of America is working on plans for a 37K SF office in One Lincoln Park across from NorthPark Center. Dairy Farmers of America purchased Dean Foods in 2020 for over $430M and this new office will house employees from both companies. Piedmont Office Realty Trust owns the building at 8401 N Central Expressway and Dallas architect Corgan is designing the office space.

DEALS IN THE MARKET • 10100 NCX – a 94,294 SF class B office building • Meadow Central | 10260 NCX & 10300 NCX – a 175,227 SF class B office campus

NEW DEVELOPMENTS • The Central – a 500K SF class A office tower (proposed) • Four Energy Square – a 400K SF class A office tower

TOP LEASE TRANSACTIONS • Dairy Farmers of America has signed a 37K SF lease in One Lincoln Park.

• Bankcorp Professional Bank has signed a 3.9K SF lease in 10000 NCX.

• Hair Today Gone Tomorrow Electrolysis LLC has signed

HLC Deal

a 2.3K SF lease in 4245 NCX.

• Johnson Development Associates, Inc has signed a 1.5K

HLC Deal

SF lease in 4245 NCX.

(proposed)

LARGE EXISTING VACANCIES • Eighty-Eighty Central – 101,019 SF • Cityplace Tower – 95,408 SF • Two Energy Square – 71,078 SF • The Pyramids at Park Lane – 50,016 SF • Campbell Centre South Tower – 48,888 SF • The Bogart – 44,220 SF • Walnut Glen Tower – 43,209 SF • Three Energy Square – 41,404 SF

10

FAR NORTH DALLAS SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(1,334,608)

(100,992)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

26.2%

26.0%

21.0%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

66,892

1,708,649

2,356,061

Delivered SF

1,188,319

vs. Prev. Qtr

vs. 12 Mths Ago

560330

248,662

64,233

Quoted Rates

vs. Prev. Qtr

vs. 12 Mths Ago

$31.68

$30.61

$31.78

VITAL STATS

28.0%

1,000,000

26.0%

500,000

24.0%

0

22.0%

(500,000)

20.0%

(1,000,000)

18.0%

(1,500,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

Deliveries

4Q 20

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

• Freddie Mac has plans to move its new regional office into Legacy Central before the end of the year. Transwestern stated back in January that “a Fortune 100 financial corporation is executing a new 155K SF lease at Legacy Central.” More than $13M will be spent to renovate the offices designed by architect HOK. Freddie Mac will be the largest tenant in Legacy Central along with Samsung and Peloton.

• The Headquarters II high-rise was purchased by a New York-based investment group affiliated with Monarch Alternative Capital. The private investment firm was founded in 2002 with offices in New York and London. The Headquarters II tower was developed by Heady Investments and includes a fitness center, conference center, lounge, outdoor patio, and a 700-space parking garage. The 200K SF building is officially open at Legacy business park and will be leased and managed by Heady Investments.

• Billingsley Co. will begin construction on a $36M, 252K SF building in September. The project is the first of five buildings planned for this round of development in Billingsley’s International Business Park in Plano. Near the northwest corner of Dallas North Tollway and Plano Parkway, the mixed-use project is expected to be delivered in 2022. Dallas architect GFF designed the building and the adjoining International Business Park amenity center includes a fitness center, conference and event space, and a tenant lounge. The first office tenants will include Alto Pharmacy, Premier Lending, Bluewater Learning, Tridius Tech, Amwins, and Tri Pointe Homes.

• After more than a year of construction, the third office building at Frisco Station was opened by VanTrust Real Estate LLC. Located west of Dallas North Tollway on Warren Parkway, the building is the third of five planned office buildings in the project. The Offices Three at Frisco Station is surrounded by hotels, multi-family properties, and 30+ walkable restaurants.

• Billingsley Co. is preparing to break ground on its newest development in International Business Park. Billingsley finished the first of five new buildings planned last fall, and construction is gearing up on the next building, a 252K SF office at 6261 W Plano Parkway. Once completed, five buildings with nearly 1M SF are planned in the new campus, designed by Dallas-based Architect GFF.

TOP LEASE TRANSACTIONS

• Randstad Professionals US has signed a 31.8K SF lease in Plaza at Legacy.

• Interior Logic Group has signed a 17.6K SF lease in The Offices Three at Frisco Station.

DEALS IN THE MARKET • • • HLC • Deal

The Campus at Legacy West – a 1,830,332 SF class A office campus The Campus at Legacy – a 394,405 SF class A office campus International Plaza I – a 376,558 SF class A office building Trinity Square Plaza – a 59,828 SF class B office building

NEW DEVELOPMENTS

• 5501 Granite Parkway – a 440K SF class A office building (proposed) • The Tower at Hall Park – a 300K SF office class A building (under construction) • NWC Dallas Parkway & Cowboys Way – a 300K SF class A office building (proposed) • The Heritage at Spring Creek – a 220K SF class A office building (proposed)

LARGE EXISTING VACANCIES • 5400 Legacy Drive – 1,587,458 SF • 6501 Legacy Drive – 551,430 SF • 5320 Legacy Drive – 483,743 SF • The Campus at Legacy – 480,653 SF • 7900 Windrose Avenue – 357,500 SF • 5301 Legacy Drive – 296,433 SF • International Plaza II – 233,230 SF • 6400 Legacy Drive – 226,835 SF

11

FORT WORTH CENTRAL BUSINESS DISTRICT SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

3,401

(100,242)

(189,262)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

16.9%

16.3%

14.8%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

-

-

vs. Prev. Qtr

vs. 12 Mths Ago

-

-

vs. Prev. Qtr

vs. 12 Mths Ago

$27.44

$27.52

Delivered SF Quoted Rates $27.47

VITAL STATS

20.0%

200,000 150,000

18.0%

100,000 50,000

16.0%

0 (50,000)

14.0%

(100,000) (150,000)

12.0%

(200,000) (250,000)

10.0%

(300,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

Deliveries

4Q 20

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

About 1,500 businesses call downtown Fort Worth home, and of their 46K employees, more and more are returning to the office each week.

“We’ve seen a sharp rise in office user return,” said Andy Taft, president of Downtown Fort Worth Inc. “In June, our parking survey suggested about 35% of the office users were coming back. In July, it jumped to about 50%. This is consistent with what CEOs were telling us would happen. More companies are bringing their employees back each week, so the next few months should see steady gains.”

As employees return to the office, activity has also returned to the leasing market. In the Dallas Business Journal’s most recent Relocation Station article, we identified nine opportunities in downtown Fort Worth that could accommodate a large relocation or headquarters move. These nine opportunities account for nearly 3M SF of existing and future office space.

Downtown Fort Worth is already home to a number of headquarters, including FirstCash Inc. (Nasdaq: FCFS), Freese and Nichols, GM Financial and TPG Global. According to DFWI, downtown’s 1,500 businesses and 46K employees have a private payroll of $3B annually.

Thousands of new residents will be calling downtown Fort Worth home over the next few years as residential development picks up after a pandemic-induced lull. A handful of projects under construction will bring about 1,500 people to downtown by late next year, including several affordable housing units. Projects in the planning stage bring the total to 3K, according to Downtown Fort Worth Inc. Looking at just projects under construction, that’s a 10% increase in population for downtown in the coming year.

“You’ve got a lot of new people that are consumers and workers all in the center city that weren’t here before,” said Taft.

12

Zooming out from just downtown, Taft noted there are about 5K new apartment units in Fort Worth’s core in places like the Near Southside, West Seventh and Race Street. Those residents stabilize downtown businesses like shops and restaurants when there’s a fluctuation in tourism or office workers. Many of those businesses need a boost after the pandemic.

TOP LEASE TRANSACTIONS

• An undisclosed tenant has signed a 4,961 SF lease in Frost Tower.

• Third Coast Bank has signed a 3,008 SF lease in One City Place.

DEALS IN THE MARKET

• 307-309 W 7th Street – a 439,802 SF class B office building • 115 W 7th Street – a 300,347 SF class B office building • 110 W 7th Street – a 101,390 SF class B office building

LARGE EXISTING VACANCIES • • • • • • •

115 W 7th Street – a 186,684 SF Bank of America Tower – a 124,604 210 E 7th Street – an 82,226 SF Frost Tower – a 54,528 SF 777 Main – a 54,399 SF Burnett Plaza – a 52,502 SF Oil & Gas | Star-Telegram Building – a 42,381 SF

LAS COLINAS SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(400,962)

(483,187)

(53,794)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

23.3%

22.2%

19.2%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

411,805

220,086

vs. Prev. Qtr

vs. 12 Mths Ago

0

200,000

300,000 Delivered SF 111,805 Quoted Rates $26.59

vs. Prev. Qtr

vs. 12 Mths Ago

$26.60

$26.42

VITAL STATS

25.0%

2,000,000 1,500,000

20.0% 1,000,000 15.0%

500,000 0

10.0%

(500,000) 5.0% (1,000,000) 0.0%

(1,500,000) 2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

3Q 19

Absorption

4Q 19

1Q 20

Deliveries

2Q 20

3Q 20

4Q 20

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • Cottonwood Financial Administrative Services, a HLC Deal

consumer finance firm, has signed a 40K SF lease in Cottonwood Office Center in Las Colinas. The lease to CFAS is the second recent transaction at the building campus, following Medpace Inc. taking more than 47K SF prior. Cottonwood Office Center is undergoing a renovation to include a new amenity center, conference facility and fitness center. The 165K SF, three (3) building office campus is owned by Capital Commercial Investments and leased by Holt Lunsford Commercial.

• Urban Towers in Las Colinas has landed a $95M loan from Bank of America. The owner, Parallel Capital Partners Inc., used the loan to refinance the property.

Urban Towers is more than 80% leased with major tenants such as The Pasha Group, Celanese, MultiPlan Inc. and Hyundai Merchant Marine.

TOP LEASE TRANSACTIONS • Finance of America Holdings has signed a 9.9K SF

NEW DEVELOPMENTS • Hidden Ridge Tower – a 400K SF class A office building (proposed)

• Las Colinas Corporate Center III – a 200K SF class A office building (proposed)

• Freeport Commons – a 1.2K SF class A office building (proposed)

LARGE EXISTING VACANCIES • 6000 Connection – 292,072 SF • Williams Square West – 237,639 SF • Las Colinas Connection – 222,244 SF • Regent Commons – 214,985 SF • Horizon Way Business Park – 180,788 SF • Williams Square Central – 174,560 SF • Browning Place III – 170,848 SF • 1551 Corporate Drive – 167,667 SF • 2901 Kinwest Parkway – 153,173 SF • 1555 W Walnut Hill Lane – 151,736 SF • Las Colinas Corporate Center I – 137,145 SF

renewal in Tower 909.

• Swift Technologies has signed a 2.1K SF lease in

HLC Deal

Corporate Plaza I.

DEALS IN THE MARKET • Royal Ridge I-IV – a 506,057 SF class B office campus • Riverside Commons – a 469,214 SF class A office campus

• The Point at Las Colinas – a 403,429 SF class A office building

• Connection Park I & II – a 282,356 SF class A office campus

• 6555 Sierra Drive – a 247,254 SF class B office building • 200 W John Carpenter – a 189,776 SF class C office building

• 5601 Executive – a 163,856 SF class B office building

13

LBJ SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(249,962)

(164,586)

(160,883)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

24.7%

23.5%

21.3%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

107,000

107,000

107,000 Delivered SF Quoted Rates $23.79

vs. Prev. Qtr

vs. 12 Mths Ago

-

-

vs. Prev. Qtr

vs. 12 Mths Ago

23.49

23.14

VITAL STATS

25.0%

300,000

24.5%

200,000

24.0% 100,000

23.5% 23.0%

0

22.5% (100,000)

22.0% 21.5%

(200,000)

21.0% (300,000)

20.5% 20.0%

(400,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

Deliveries

4Q 20

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • After a year of renovation, Lincoln Centre is ready

for workers to return. The renovation by Scott & Reid General Contractors completely reset both the interior spaces and the grounds surrounding the office towers.

Since the renovation, Lincoln Centre is experiencing a steady increase in activity plus major office leases by Coca-Cola and Huitt Zollars Inc.

TOP LEASE TRANSACTIONS • SCA Promotions has signed a 22K SF renewal in Element Towers East.

• Regus has signed a 12.4K SF lease in Three Lincoln Centre.

• Crayon Software Experts LLC has signed a 10K SF lease in Three Forest Plaza.

• T4 Global, Inc. has signed a 3.2K SF lease in North Central Plaza I.

14

DEALS IN THE MARKET • Galleria Square – a 49,504 SF class B office building NEW DEVELOPMENTS • Park Heritage – 1.15M SF (proposed) • Four Lincoln Centre – 400K SF (proposed) • Park Tower at Dallas Midtown – 376,870 SF (proposed) • The Inwood at Alpha West – 300K SF (proposed) LARGE EXISTING VACANCIES • Park Central 8 – 225,924 SF • Three Galleria Tower – 133,888 SF • Pinnacle Tower – 98,412 SF • Crosspoint Atrium – 93,450 SF • Lake Highlands Tower – 74,252 SF • One Lincoln Centre – 66,094 SF

MIDINTELLIGENCE CITIES SUBMARKET Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

11,644

(163,738)

11,987

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

25.1%

25.2%

22.8%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

84,633

213,984

vs. Prev. Qtr

vs. 12 Mths Ago

-

42,050

vs. Prev. Qtr

vs. 12 Mths Ago

$20.89

$20.00

97,934 Delivered SF Quoted Rates $21.16

VITAL STATS

16.0%

2,000,000

1,500,000

14.0%

1,000,000 12.0% 500,000 10.0%

0

8.0%

(500,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

Deliveries

2Q 20

3Q 20

4Q 20

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • District 114 at Kimball Park, a 94,650 SF mixed-use

building at the entrance to Kimball Park on State Highway 114, is set to deliver Summer 2021. The threeand four-story class A building will feature retail space on the entire first floor along with almost 5K SF of Tenant Lounge and patio space. Kimball Park is a 15.81acre, mixed-use development by Medici Development Partners adjacent to Highway 114 in Southlake with over 200K SF of class A office along with a full service hotel and conference center and multiple dining options.

• Bell Textron, Inc. has announced plans to expand their presence at the Arlington Municipal Airport with a new Systems Integration Lab facility. The state of the art facility will support testing and verification for both the Future Long-Range Assault Aircraft and Future Attack Reconnaissance Aircraft programs. Construction of the facility is expected to begin Summer 2021.

TOP LEASE TRANSACTIONS • Coastal Brokers has signed a 15,142 SF lease in 1301 Solana Boulevard.

• North American Title has signed a 8,862 SF lease in 700

HLC Deal

Highlander.

• Centrum Healthcare has signed a 6,426 SF lease in 4700 Little Road.

DEALS IN THE MARKET • Richland Corporate Centre – a 142,425 SF class A office building

• 1351 E Bardin Road – a 115,490 SF class B office building • 3400 William D Tate – a 56,520 SF class B office building NEW DEVELOPMENTS • Charles Schwab Campus – a 616,999 SF class A complex • 2102 E State Highway 114 – a 103K SF class A office building

• 2101 Westpark Court – a 60KSF class A medical office building

• 1700 N White Chapel Boulevard – a 48K SF class A office building

LARGE EXISTING VACANCIES • 1900 W Kirkwood Boulevard – 379,898 SF • 2200 W Airfield Drive – 310,350 SF • 1500 Solana Boulevard | Building 1 – 72,138 SF • 1500 Solana Boulevard | Building 5 – 69,562 SF • 950 E State Highway 114 – 66,707 SF • 8555 Airport Freeway – 47,277 SF • 2208 Highway 121 – 46,052 SF • 500 E Border Street – 42,668 SF & 41,863 SF • 2200 Highway 121 –42,415 SF • 3400 William D Tate Avenue – 40,738 SF

15

NORTH FORT WORTH SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

12,846

87,919

(50,073)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

5.2%

5.3%

5.8%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

143,000

140,000

vs. Prev. Qtr

vs. 12 Mths Ago

173,000 Delivered SF 3,325 Quoted Rates $27.61

48,306

23,008

vs. Prev. Qtr

vs. 12 Mths Ago

$27.52

$27.64

VITAL STATS

12.0%

200,000 150,000

10.0%

100,000 8.0%

50,000 0

6.0%

(50,000)

4.0%

(100,000) 2.0%

(150,000)

0.0%

(200,000) 2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

Absorption

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Deliveries

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

PMB Capital Investment, a Dallas-based real estate investment and development firm, announced on July 20 plans for a new residential community located in North Texas near the intersections of State Highway 114 and U.S. 287. The master-planned development, named Reunion, will feature more than 10K single-family homes, across 3,600 acres of preserved lakes, rolling hills, waterfalls, woods and natural terrain. The first phase of homes, with prices ranging from the $250s to $600s, is slated for delivery in fall 2022. Residential lot sizes will vary from 40-foot cottage-style lots to 70-foot estate lots with home designs from reputable builders including American Legend Homes, Perry Homes, and UnionMain Homes. Situated between the cities of Newark and Rhome, Reunion is near several area attractions, including Texas Motor Speedway, Alliance Town Center, Tanger Outlet Mall and more commercial development that is planned within the project. Residents can also enjoy access to the Northwest ISD public school system, a booming job market and connectivity to the major hub cities of Dallas-Fort Worth.

Goldman Sachs Group is looking for a new office campus in Dallas-Fort Worth. The site will be the Wall Street bank’s largest presence in the U.S. outside of its Manhattan headquarters. Governor Greg Abbott tweeted that the financial sector is booming in Texas and that Goldman’s DFW property will be “huge.” Goldman currently has office space in Dallas at the Trammell Crow Center downtown, where it moved in 2018 and houses more than 330 employees. Sources say the company is looking for at least 1M SFfor its new Dallas campus—about half the size of its 2M SF global headquarters in Manhattan. The requirement seems in line with what we have seen from other financial institutions moving into North Texas. For example, Charles Schwab’s headquarters at Hillwood’s Circle T Ranch in Westlake totals about 1.1M SF.

16

TOP LEASE TRANSACTIONS • An undisclosed Tenant has signed a 12,911 SF lease at 8224 White Settlement Road.

• Tequila Ranch has signed a 4,120 SF lease at 1485 Commons Circle.

• Mathnasium has signed a 2,082 SF lease in 612 E Bailey Boswell Road.

DEALS IN THE MARKET • 1301 Solana Boulevard – a 360,883 SF class A office building

• 2301 Eagle Parkway – a 73,747 SF class A office building

• 534 N Main Street – a 49,183 SF class B office building • 8224 White Settlement Road – a 27,716 SF class B office building

NEW DEVELOPMENTS • 12600 Willow Springs Road – a 54k SF class A office building set to deliver October 2022

• Alta Vista Road & N Beach – a 48K SF class A office building set to deliver October 2021

• 3800 N Tarrant Parkway – a 29K SF class B office building set to deliver May 2022

LARGE EXISTING VACANCIES • 13650 Heritage Parkway - 164,333 SF • 5555 N Beach Street – 163,283 SF • 2601 Meacham Boulevard – 162,845 SF • 3575 Lone Star Circle – 43,560 SF

PRESTON CENTER SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(33,648)

(23,349)

(52,013)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

14.2%

13.6%

13.1%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

615,632

297,000

Delivered SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

0

0

Quoted Rates

vs. Prev. Qtr

vs. 12 Mths Ago

$42.00

$39.62

615,632

$42.35

VITAL STATS

16.0%

150,000

100,000

14.0%

50,000 12.0% 0 10.0% (50,000) 8.0%

(100,000)

6.0%

(150,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

Deliveries

2Q 20

3Q 20

4Q 20

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • Lincoln Property Company and its partners have set a May groundbreaking for two new towers in Preston Center. The developments will include a 225K SF office building and a separate tower comprising 128 luxury multifamily units. Sewell Automotive Cos. is taking roughly 26.5K SF in the 12-story tower and Lincoln Property will move its headquarters into about 59K SF. Dallas architect HKS designed the project which is estimated to be complete in the second half of 2022.

TOP LEASE TRANSACTIONS • Lincoln Property Company has signed a 59K SF lease in 8111 Douglas.

• Sewell Automotive Cos. has signed a 26.5K SF lease in

DEALS IN THE MARKET • Bluffview Towers – a 196,346 SF class A office campus NEW DEVELOPMENTS • 8111 Douglas – a 318K SF class A office building (under construction)

• Weir’s Plaza – a 297K SF class A office building (under construction)

LARGE EXISTING VACANCIES • 8343 Douglas at Douglas Center – 64,278 SF • Bluffview Towers – 61,228 SF • 5950 Sherry Lane – 23,138 SF • 5956 Sherry Lane – 19,957 SF • 5949 Sherry Lane – 14,800 SF

8111 Douglas.

• Capital Southwest Corp. has signed a 13.3K SF lease in 8333 Douglas.

17

RICHARDSON/PLANO/ALLEN/MCKINNEY SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

325,247

(481,900)

61,309

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

20.6%

21.1%

19.2%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

397,892

529,811

vs. Prev. Qtr

vs. 12 Mths Ago

184,088 Delivered SF 115,032 Quoted Rates $24.14

16,007

31,468

vs. Prev. Qtr

vs. 12 Mths Ago

$24.17

$24.12

VITAL STATS

22.0%

400,000 300,000

21.0%

200,000 100,000

20.0%

0 19.0%

(100,000) (200,000)

18.0%

(300,000) (400,000)

17.0%

(500,000) 16.0%

(600,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Deliveries

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

• California-based Bay West Development is working on plans for a new mixed-use project in Plano. The 19-acre proposed development would be on the site of the former Fry’s Electronics store between Bush Turnpike and Plano Parkway, just east of the Central Five Hundred Office Building on U.S. Highway 75. Plans call for two five-story apartment buildings, a six-story office building and an eight-story hotel. The two apartment buildings would be on the north end of the property along Plano Parkway, while the office building is planned for the south end of the site where it would include 123K SF. The hotel is slated to face Bush Turnpike.

• McKinney-based Independent Financial has announced plans to triple the size of its campus in the Craig Ranch development after purchasing an additional 17 acres. The expansion will bring its campus to 30 acres and will allow for the development of two or three additional office buildings. The company had 1,513 employees at the end of 2020 and did not provide a timeline for the construction of the new office buildings.

• One of the Telecom Corridor’s largest office campuses, Galatyn Commons, has changed hands. The four-building project in Richardson with nearly 800K SF of space was constructed in 1997 for telecom firm Nortel Networks. Spear Street Capital has owned the complex since 2014. Now, parts of the Galatyn Commons complex have been sold to Singapore-based Mapletree Investments Pte Ltd. Spear Street spent more than $40M to renovate the complex, adding parking, a conference center, and an outdoor plaza.

• Developers have pitched a new office project in the CityLine campus in Richardson. The 300K SF proposed office building is near the southeast corner of U.S. Highway 75 and George W. Bush Turnpike and the site is owned by BC Station Partners. Dallas architect BOKA Powell designed the building that is currently being marketed for corporate relocations and built-to-suit opportunities.

•

TOP LEASE TRANSACTIONS

• RPM xConstruction has signed a 17.3K SF expansion in Tollway North Office Park.

• Community Urgent Care System has signed a 12.4K SF lease in Tollway North Office Park.

• Robin Autopilot USA has signed a 6.6K SF lease in The Square at Craig Ranch.

HLC Deal

• Accuver has signed a 5.7K SF renewal in Central 500.

HLC Deal

• PHA Consulting Engineers has signed a 5.4K SF renewal in Corporate Place of Richardson.

HLC Deal

• Digtal.ai Software has signed a 5K SF lease in Granite Park Three.

HLC Deal

• Better Living has signed a 4.3K SF expansion in Atrium at McDermott.

• Wiz Semiconductor has signed a 4.3K SF renewal in CityView Corporate Center.

HLC Deal

18

• JM Civil Engineering has signed a 3.7K SF lease in the Office Campus at Allen.

HLC Deal

• Thakkar Development has signed a 2.9K SF lease in The Square at Craig Ranch.

HLC Deal

• Pow Technologies has signed a 2.6K SF lease in 7920 Belt Line.

HLC Deal

• GuruFocus has signed a 2.3K SF lease in CityView Corporate Center.

HLC Deal

• Azcarate & Associates has signed a 1.9K SF renewal in 7920 Belt Line.

• Lemmon Avenue Age Management has signed a 1.6K SF lease in 1101 E Arapaho.

HLC Deal

• Sage Street Realty has signed a 1.4K SF lease in Central Five Hundred.

HLC Deal

• East Feliciana Designs has signed a 1.1K SF lease in Promenade Tower.

HLC Deal

DEALS IN THE MARKET

• Waterview 190 – a 230,062 SF class A office campus • Custer Court – a 121,596 SF class B office building • 2601 Telecom – a 100,310 SF class B office building

NEW DEVELOPMENTS • • • • •

CityLine – 2M SF (proposed) 7 CityLine – 417K SF (proposed) Legacy Central 5 – 300K SF (proposed) One Heritage Creekside – 250K SF (proposed) Allen Tech Hub – 100K SF

LARGE EXISTING VACANCIES • • • • • • • •

601 Data – 423,123 SF 465 Independence Parkway – 251,347 SF 3400 Cityline – 215,132 SF Fossil Headquarters – 211,195 SF 2200 George Bush – 176,831 SF 1125 E Campbell – 168,968 SF Lookout Park I – 156,219 SF Cardinal Park 8 – 142,356 SF

SOUTHWESTINTELLIGENCE FORT WORTH SUBMARKET Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

93,271

(691)

(250,189)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

11.0%

10.8%

10.0%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

107,000

67,300

vs. Prev. Qtr

vs. 12 Mths Ago

92,600 Delivered SF 24,263 Quoted Rates $26.09

4,500

55,695

vs. Prev. Qtr

vs. 12 Mths Ago

$25.98

$25.88

VITAL STATS

14.0%

150,000 100,000

13.0%

50,000

12.0%

0 11.0% (50,000) 10.0% (100,000) 9.0%

(150,000)

8.0%

(200,000)

7.0%

(250,000) 2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

Absorption

3Q 19

4Q 19

1Q 20

2Q 20

3Q 20

4Q 20

Deliveries

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS

A large office building near Fort Worth’s Cultural District west of downtown sold to an undisclosed local investor. The purchase price for the three-story building at 200 Bailey Avenue was also not made public. The office market in that area has remained about 85% occupied with rents near $29 per SF throughout the COVID-19 pandemic when many companies downsized office space, according to Transwestern Real Estate Services, which brokered the sale.

Roughly 18K SF, or more than a third, of the building is vacant. That allows the new owner to revamp some office space and offer a large block or smaller office suites. Lead tenant Hahnfeld Hoffer & Stanford Architects will stay in the building.

The $250N plan to bring luxury living, a boutique hotel, and office space to vacant lots in Fort Worth’s Cultural District is looking for financial help from the city, but not in the form of a tax break. Instead, the city has proposed buying two parking garages from the developer. Billionaire real estate developer, John Goff, intends to build a luxury hotel at 3300 Camp Bowie Boulevard across from the Kimbell and Modern Art Museums. The concept includes an office building, where Goff will headquarter his companies, and 175 luxury residential units.

“It is common for the city to grant new commercial development a property tax abatement or work out a deal with hotel developers to share in new sales tax generated from room rentals,” said Robert Sturns, director. “Because of the uniqueness of Goff’s project, the city’s economic development department wanted to work out a different incentive.”

share increases to 50% for the remainder of the lease.

Crescent Real Estate will be responsible for maintenance of the garages which the city can sell at any time after the first year.”

TOP LEASE TRANSACTIONS • VLK Architects has signed a 25,663 SF lease at 1320 Hemphill Street.

• Concept Connections has signed a 10,550 SF renewal

HLC Deal

at 4201 Bridgeview.

• Encompass Home Health has signed a 7,493 SF lease

HLC Deal

at One Ridgmar Centre.

DEALS IN THE MARKET • 3150 McCart Avenue – a 46,292 SF class C office building

• 108 South Freeway – a 41,427 SF class C office building

• 3509 Hulen Street – a 27,766 SF class B office building NEW DEVELOPMENTS • 1320 Hemphill Street – a 48,594 SF class A office building set to deliver January 2022

• 4000 Bryant Irvin – a 18,194 SF class A office building set to deliver December 2021

LARGE EXISTING VACANCIES • 4055 International Plaza – a 53,013 SF • 405 West Loop 820 – a 101,043 SF • One Ridgmar Centre – a 36,796 SF • Western Place I – a 19,871 SF • 1300 Summit Avenue – a 15,543 SF

Once the project is open, the city will issue $25M to debt to purchase two parking garages from Goff’s Crescent Real Estate. The City of Fort Worth will lease back use of the garages to the developer for approximately $800k per year and split the revenue generated from parking.

“For the first five years, the city will receive 25% of the parking revenue,” said Sturns. “After that Fort Worth’s

19

STEMMONS SUBMARKET INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

45,133

(58,259)

(42,441)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

25.4%

25.8%

25.4%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

65,000

108,650

65,000 Delivered SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

0

0

Quoted Rates

vs. Prev. Qtr

vs. 12 Mths Ago

$20.21

$18.46

$20.56

VITAL STATS 26.0%

500,000 400,000 300,000

25.0%

200,000 100,000 24.0% 0 (100,000) 23.0%

(200,000) 2Q 18

3Q 18

4Q 18

1Q 19

Absorption

2Q 19

3Q 19

4Q 19

1Q 20

Deliveries

2Q 20

3Q 20

4Q 20

1Q 21

2Q 21

Vacancy

Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • As of June 30, more than half of Dallas-Fort Worth’s office workers are officially back in their buildings.

Additionally, major employers are expecting to have most employees back in the office by September.

Nationwide, fewer than 33% of buildings are staffed with workers.

• Dallas-Fort Worth led the country in population growth

in 2020, adding nearly 120K residents, according to the latest data from the U.S. Census. Over the past five years, Dallas-Fort Worth’s population has grown by more than 650K. The surge in population growth has given the metroplex a total population of roughly 7.7M. Dallas-Fort Worth has now surpassed Houston to become the country’s fourth largest metro area, behind New York, Los Angeles, and Chicago.

20

TOP LEASE TRANSACTIONS • Ann Sacks & Tile has signed a 9.2K SF lease in 1403 E Levee Street.

• Archetype has signed a 2.4K SF lease in 2103-2119 Irving Boulevard.

NEW DEVELOPMENTS • West Love | 2345 Mockingbird Lane – 1.1M SF (proposed)

• The Design District Tower – 243,100 SF (proposed) • 1333 Oak Lawn – a 122.7K SF class A office building (proposed)

LARGE EXISTING VACANCIES • 1430 & 1440 Empire Central Drive – 320K SF • 9999 Technology Boulevard W – 150,272 SF • The Connection at 8600 – 101,530 SF • 8777 N Stemmons – 76,968 SF • Pegasus Park – 70,439 SF • 7800 N Stemmons – 69,588 SF

SUBMARKETUPTOWN INTELLIGENCE Absorption

vs. Prev. Qtr

vs. 12 Mths Ago

(130,338)

(118,076)

(42,315)

Vacancy

vs. Prev. Qtr

vs. 12 Mths Ago

20.2%

19.2%

15.7%

U/C SF

vs. Prev. Qtr

vs. 12 Mths Ago

1,016,688

656,774

Delivered SF

vs. Prev. Qtr

vs. 12 Mths Ago

0

0

0

1,016,688

Quoted Rates $41.82

vs. Prev. Qtr

vs. 12 Mths Ago

$41.01

$40.17

VITAL STATS

25.0%

400,000 300,000

20.0%

200,000 100,000

15.0%

0 (100,000)

10.0%

(200,000) (300,000)

5.0%

(400,000) 0.0%

(500,000) 2Q 18

3Q 18

4Q 18

1Q 19

2Q 19

3Q 19

Absorption

4Q 19

1Q 20

2Q 20

3Q 20

Deliveries

4Q 20

1Q 21

2Q 21

Vacancy Source: CoStar 2Q 2021 Office Report

CURRENT EVENTS • Texas-based real estate company, Stonelake Capital

Partners, has purchased a four-story building on McKinney and Routh across from Whole Foods. The 40K SF Uptown office building, 2602 McKinney, was acquired after Stonelake Capital closed a new $555M investment fund. Most of the participants in the fund were institutional investors, hospital systems, pension funds and private foundations. Holt Lunsford Commercial will handle the leasing for 2602 McKinney.

• Just a month after The Crescent sold for almost $700M to Fort Worth-based Crescent Real Estate, the new owner is executing leases that it was working on during closing. Susser Bank Holdings, Verde Investments Inc., Work Shield LLC, MSL Healthcare, Schonfeld Strategic Advisors, and First Foundation have all signed leases at the Crescent during or since the closing, starting new ownership off on the right note post-closing.

• Chicago-based global law firm Vedder Price PC

has signed a lease in the Crescent. The firm will be taking 11.1K SF for its new operations in Uptown after announcing in January that it would be opening a new Dallas office.

TOP LEASE TRANSACTIONS • Vedder Price PC has signed an 11.1K SF lease in the Crescent.

• Berkley Partners has signed a 4.7K SF lease in Harwood No. 6.

• Susser Bank Holdings has signed a 4.6K SF lease in the Crescent.

• Verde Investments has signed a 4.4K SF lease in the Crescent.

• Work Shield has signed a 4.4K SF lease in the Crescent.

• Baranoff Holdings has signed a 3.9K SF lease in Harwood No. 10.

• Skin Pharm has signed a 3.6K SF lease at 3131 Turtle Creek Boulevard.

• And Dubber has signed a 3.5K SF lease in Harwood No. 4.

• MSL Healthcare has signed a 2.9K SF lease in the Crescent.

• Schonfeld Strategic Advisors has signed a 2.8K SF lease in the Crescent.

DEALS IN THE MARKET • 2626 Cole – a 120,139 SF class A office building NEW DEVELOPMENTS • 2601 Victory Avenue – a 364,733 SF office building (under construction)

• Harwood No. 14 – a 359,914 SF office building (under construction)

• The Quad – a 335K SF office building (under construction)

• The Link – a 292,041 SF office building (under construction)

• 2401 McKinney – a 673,245 SF office building (proposed)

• 2323 Cedar Springs – a 623,610 SF office building (proposed)

• Harwood XII – a 541,640 SF office building (proposed) • McKinney & Lemmon – a 487K SF office building (proposed)

• 2371 Victory Avenue – 466K SF office building (proposed)

• Parkside Terraces – a 425K SF office building (proposed)

• 3001 Turtle Creek – a 366,181 SF office building (proposed)

• 2727 Turtle Creek – a 260,072 SF office building (proposed)

• The Fairmount Building – a 62,960 SF office building (proposed)

LARGE EXISTING VACANCIES • Parkside Tower – 111,728 SF • 2501 Cedar Springs – 110,415 SF • The Centrum – 106,523 SF • 2401 Cedar Springs – 69,471 SF • 1919 McKinney Avenue – 63,057 SF 21

DALLAS

5950 Berkshire Lane Suite 900 Dallas, Texas 75225 T 972.241.8300 F 972.241.7955

FORT WORTH

1200 Summit Avenue Suite 300 Fort Worth, Texas 76102 T 817.710.1110 F 817.810.9017

www.holtlunsford.com

HOUSTON

11451 Katy Freeway Suite 300 Houston, Texas 77079 T 713.850.8500 F 713.850.8550